Article: Outcry grows over naked short sales

Article - Media

Outcry grows over naked short sales

Will Shanley

The Denver Post, 14 October 2006

It began as Pederson watched words appear on her computer screen at her Arvada home office. Investors, writing via an Internet chat room, were touting a mining company called CMKM Diamonds Inc.

The Las Vegas-based company, the investors claimed, owned mineral rights to more than a million acres of diamond-rich land in Saskatchewan, Canada. Intrigued, Pederson bought shares worth $15,000.

The decision began Pederson’s involvement in a saga that includes lawsuits, huge financial losses and allegations of fraud on Wall Street and inaction by federal regulators.

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